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Compute the margin of safety dollars and as a ratio

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Reference no: EM132652397

Question - In the month of April, Avante Salon gave 3,100 haircuts, shampoos, and permanents at an average price of $30. During the month, fixed costs were $20,900 and variable costs were 75% of sales.

Instructions - Show and label all calculations

(a) Determine the contribution margin in dollars, per unit, and as a ratio.

(b) Using the contribution margin technique, compute the break-even point in dollars and in units.

(c) What sales are necessary to earn an income of $50,000?

(d) Compute the margin of safety dollars and as a ratio.

Reference no: EM132652397

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